As India's electric vehicle and energy storage markets expand, the country faces a new resource challenge: dependence on imported lithium, nickel, cobalt, graphite and other critical minerals. In an interaction with BW Businessworld, Rahul Gogi, Vice President – Growth & Strategy at Recyclekaro, discusses why battery recycling is becoming strategically important for India, the potential of urban mining, the economics of recycling LFP batteries, and the challenges posed by feedstock shortages and the informal sector.
Why is battery recycling becoming strategically important for India?
India's energy transition is creating a new kind of resource dependency. We may gradually reduce our dependence on imported oil, but batteries, which are essential for electric vehicles, energy storage and the wider clean-energy ecosystem, require lithium, nickel, cobalt, graphite and other critical minerals. Global supply chains for these minerals are currently concentrated in a limited number of geographies. For instance, Indonesia is a major producer of nickel, while much of the world's cobalt comes from African countries such as the Democratic Republic of Congo. More importantly, a significant proportion of the world's critical minerals processing and refining capacity is concentrated in China, which is also a major hub for battery manufacturing.
That is why battery recycling is no longer merely an environmental concern; it is also a material-security issue. India is expected to see tremendous demand for these materials in the coming years, while its domestic mining opportunities for several strategic critical minerals remain limited. This makes the recovery of critical minerals from spent batteries and end-of-life electronics extremely important. Urban mining can become one of the most dependable and controllable sources of these materials. The first generation of electric vehicles and energy-storage systems deployed before 2020 is now beginning to approach end-of-life or reduced-capacity stages. For example, an EV purchased in 2020 that has travelled more than 50,000 kilometres may see its battery capacity fall to around 80 per cent or lower, depending on usage. We are already seeing a growing volume of end-of-life batteries and electronic waste reaching recyclers. Recyclekaro has worked with leading OEMs across two-wheelers, three-wheelers, four-wheelers and commercial vehicles.
If critical minerals are recovered domestically, India can reduce a portion of its import requirements, lower pressure on foreign exchange reserves and retain more value within the domestic economy. Domestic recovery can also provide greater control over material availability and pricing. This is one of the biggest reasons battery recycling is becoming strategically important for India.
How much can recycling realistically reduce India's dependence on imported critical minerals?
It is difficult to put an immediate percentage on it, and we have to be realistic. Recycling cannot completely replace mining or imports, particularly in India, where battery demand is growing much faster than the volume of batteries currently reaching end-of-life. However, recycling can become a very important secondary source of critical minerals. As collection and recycling systems mature, recycled materials could meet a meaningful share of future demand for lithium, nickel and cobalt. For India, I see recycling as a domestic buffer. It can reduce part of our incremental import requirement and protect the country from global supply disruptions. We have already seen how restrictions on the export of certain battery components can affect manufacturing elsewhere.
India currently imports a large proportion of its battery cells and largely operates at the assembly layer. However, domestic cell manufacturing is gradually gaining traction, and by 2030, we should have reasonable domestic cell-manufacturing capacity. The broader point is that recycling can be a strong pillar in reducing dependence on imported critical minerals, but India must simultaneously continue securing overseas mineral assets and exploring domestic reserves. All these strategies need to develop together. If even one part of the equation is neglected, the country risks remaining heavily import-dependent.
You have spoken about going beyond recycling to material recovery. What does that mean in practical terms?
There are two aspects to this. Suppose a company generates 10 metric tonnes of end-of-life batteries every year. These batteries cannot simply be disposed of in conventional dumping grounds because they are inherently hazardous. They contain toxic components that can contaminate soil and groundwater and cause lasting environmental damage. Recycling addresses the first part of the problem by ensuring hazardous waste is treated responsibly. But material recovery goes further.
When recycling is carried out scientifically, with proper analysis of battery composition, valuable metals can be extracted. We are currently able to recover lithium, cobalt, nickel, graphite, manganese and several other valuable materials from end-of-life batteries. Going beyond recycling means continuously improving process efficiency: reducing the amount of energy and chemicals used, lowering effluent generation and simultaneously increasing material yields. For several metals, we are already achieving recovery efficiencies of more than 90 per cent. For nickel and cobalt, recovery rates are around 98 per cent. We also recover copper, aluminium and other valuable metals.
If recyclers optimise for maximum recovery efficiency, they can move beyond being waste processors and become reliable suppliers of critical minerals to the domestic economy. The circular economy is completed when materials recovered from end-of-life batteries return to companies manufacturing cells and assembling batteries. The objective is to move from waste processing to resource production. If we process a battery and produce only a low-value intermediate, we have solved part of the waste problem. But if we recover high-purity materials that can return to manufacturing supply chains, we are also addressing India's raw-material challenge.
What is Recyclekaro's growth strategy over the next few years?
Recyclekaro plans to invest around Rs 500 crore by 2030 to develop a world-class rare-earth and advanced-materials research centre. We inaugurated the centre in January and are continuing to build the machinery, teams and infrastructure. It is intended to become one of India's largest privately held research centres focused on material recovery. We also plan to deploy small pilot plants alongside the research centre. These facilities will allow us to rapidly test and implement our research within an integrated ecosystem where research, deployment, testing and feedback can happen together.
Our focus is on developing world-leading recovery technologies for critical minerals, advanced materials and rare earths. With the expansion of AI infrastructure and automobile electrification, demand for these materials is expected to increase significantly. Meeting that demand will require the right technologies and continuous process optimisation. We are also expanding our processing capacity. At present, we have roughly 40000 metric tonnes of capacity across e-waste, batteries and lead-acid batteries combined, and we are working towards expanding further.
Recyclekaro has also been selected as one of the entities under the National Critical Mineral Mission's incentive framework. Our central focus will remain material recovery. We are developing technologies that could allow us to directly recover cathode active material without completely dismantling and chemically breaking down a battery to recover individual metals. This approach, known as direct recycling, can potentially reduce intermediate processing steps.
The aim is to bring recycling costs down to a level where recovering a wider range of critical materials becomes financially viable. We are also working with academic and research institutions, including IIT Bombay, IIT Kanpur and BARC, to help translate research into commercial applications and develop indigenous capabilities in resource recovery.
LFP batteries are becoming increasingly common. How does that change the economics of battery recycling?
LFP batteries do not contain nickel or cobalt, which removes two of the more economically valuable metals traditionally recovered from batteries. As a result, conventional recycling of LFP batteries is currently challenging from a financial viability perspective. However, end-of-life LFP batteries still need to be responsibly processed. We are therefore working on direct-recycling technologies that could allow us to recover cathode material without completely breaking the battery down into its constituent elements. Eliminating some intermediate processes can reduce energy consumption, material losses and overall processing costs.
We are also working on graphite recovery through direct recycling. If these processes can sufficiently reduce costs, LFP recycling can become more economically sustainable. Material recovery is also not the only source of income for recyclers. Tolling charges, or waste-processing fees paid by waste generators, can support the economics of recycling. Under such a model, a company can pay a recycler to process its end-of-life batteries, while the recovered materials are returned to the company.
Another opportunity lies in second-life applications. When a battery reaches a recycling facility, not every cell necessarily has the same degree of degradation. We test individual cells for their state of health and safety, including potential thermal-runaway risks. Cells that remain healthy enough can be reassembled and used in stationary energy-storage or other second-life applications. Since this does not require recycling the battery down to the elemental level, energy, manpower, electricity and other processing costs can be significantly lower.
LFP adoption is expected to grow considerably, particularly because of its cost economics and performance across Indian temperature conditions. Through direct recycling, tolling models and second-life applications, we believe it is possible to develop sustainable economics for LFP batteries over the long term.
What is the biggest challenge facing India's battery recycling industry today?
Feedstock procurement is probably the biggest challenge. Formal recyclers compete strongly with the informal sector, which remains a major destination for India's end-of-life batteries and electronic waste. The tax structure for informal operators and formal recyclers is very different. Formal players face an 18 per cent GST burden while procuring waste, which significantly affects the economics of the recycling process. Procuring feedstock at a fair and commercially viable cost is therefore a major challenge.
Competition among formal recyclers is also intense. Companies have invested in plants, equipment and employees, and consequently need sufficient feedstock to keep their facilities running. In some cases, players may procure material even when margins are weak simply to utilise installed capacity. This creates significant price competition. EPR implementation is another area that requires substantial improvement. Formal recyclers should be able to generate value through the sale of EPR credits, but the ecosystem faces issues such as paper trading. There are instances where players may claim to have processed electronic waste or batteries without actually doing so and then sell EPR credits at lower prices, disrupting the market for legitimate operators.
This problem is particularly significant in the e-waste segment, although the situation is relatively better for batteries. EPR requires deeper intervention from policymakers and implementation authorities. Changing battery chemistries present another challenge. But the industry will have to continue innovating and finding financially and environmentally sustainable ways to process the different types of batteries that emerge in the future.